India is expected to float a paper soon on crypto after getting a nod from the highest level of government, people familiar with the matter said.
Presentation on Economic Growth
The paper was a “work in progress,” the governor told the lawmakers, according to one of the persons cited. Another person said Malhotra pointed out that cryptocurrencies were not needed in India with the Unified Payment Interface (UPI) working effectively for internal digital transactions.
Malhotra was appearing before the parliamentary standing committee on finance chaired by BJP MP Bhartruhari Mahtab, briefing members on the subject of ‘RBI’s evolving role in India’s dynamic economy.’ The central bank has in the past opposed crypto assets, flagging their misuse in money laundering and terror financing.
“Of course, as you are aware, we are concerned about crypto because that can hamper financial stability and monetary policy,” Malhotra had said on June 6 while briefing reporters on the decisions of the Monetary Policy Committee. The RBI is also in the process of establishing its own Central Bank Digital Currency (CBDC) as a safer alternative. India imposes a 30% tax on gains from virtual digital assets even though it does not legally recognise them. It has also made it mandatory for crypto exchanges operating in the country to register with the Financial Intelligence Unit.Fastest Growing
In a presentation before the panel, the RBI noted that India is poised to remain the fastest-growing major economy in FY26 while flagging downside risks from global financial market volatility and geopolitical tensions. It noted that these posed upside risks to the inflation outlook.
International rating agency S&P Global Ratings recently raised its forecast for India’s gross domestic product (GDP) growth to 6.5% for FY26 from the previous 6.3% assuming a normal monsoon, the impact of income-tax concessions, lower crude oil prices and monetary easing. This projection is in line with the RBI’s FY26 GDP forecast of 6.5%.
Rs 2,000 Notes
Replying to a question on Rs 2,000 notes by a Congress MP, Malhotra said that these had not been made “invalid” yet, but they are not in circulation and not being printed. In May 2023, the RBI had announced withdrawal of Rs 2,000 notes from circulation. They had been introduced in 2016 as part of the demonetisation exercise to curb black money.
